Philippines Q1 GDP up 2.8% on year, lower than expected

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MANILA, May 7 : The Philippine economy grew 2.8 per cent in the first quarter, the statistics agency said on Thursday, lower than forecast, constrained by the crisis in the Middle East and a delayed budget passage.  

Economists in a Reuters poll had expected first quarter gross domestic product growth of 3.5 per cent.   

"The lingering effects of oil prices and (the impact) on supply chains will persist in the coming months, there are continuing challenges ahead," Economic Planning Secretary Arsenio Balisacan told a press conference.

On a seasonally adjusted basis, the economy grew 0.9 per cent quarter-on-quarter in the January-March period, lower than the 1.5 per cent expansion forecast in the poll. 

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Balisacan said the slower expansion reflected the combined impact of "significant domestic and global challenges", including delays in the passage and release of the 2026 budget and the effects of rising prices on domestic consumption. 

He said the government would push to regain growth momentum in the months ahead and accelerate spending, including on infrastructure. The growth target would be adjusted downwards due to global uncertainty, he added.   

Philippine annual inflation accelerated to a three‑year high in April, data showed on Tuesday, as a surge in fuel costs stemming from the Middle East conflict raised the prospect of further monetary tightening.

Consumer prices rose 7.2 per cent last month, the highest since March 2023, breaching the central bank's forecast range of 5.6 per cent to 6.4 per cent for the month.

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